ECONOMY

Greece to offer taxpayers a deal to get money back home

Greece is to allow money held abroad by its taxpayers to be declared without penalty and taxed at a discount rate, a move to help overcome a cash crunch threatening the country with bankruptcy.

“The government will table a bill to allow citizens to voluntarily declare their deposits abroad,” Finance Minister Yanis Varoufakis told reporters after meeting Swiss officials in Athens.

Greeks have sent billions of euros abroad since the debt crisis exploded in 2010, fearing that the country may crash out of the eurozone. The deposit flight has strained its banks which have become dependent on central bank funding for liquidity.

A portion of the money has fled to Swiss banks.

Under the planned law, the deposits may be taxed at a rate of 15 to 20 percent, a senior finance ministry official said, an incentive for those who have sent money abroad but have not reported it as income to Greek tax authorities.

Depositors who have evaded reporting incomes would otherwise face a 46 percent tax rate and 46 percent in penalties if caught.

Varoufakis said that once the bill is passed by parliament, a political agreement will be signed between Greece and Swiss authorities to exchange information on Greek deposits held in Swiss banks.

“We have an agreement with the European Union about an automatic supply of information and this will be applied for Greece as well,” Jacques de Watteville, Swiss state secretary for international financial matters, told reporters.

“We want to support Greece in this effort.”

[Reuters]